Soggy (Sgy) and Tead2, two closely linked genes with CpG islands, were coordinately expressed in mouse preimplantation embryos and embryonic stem (ES) cells, but were differentially expressed in differentiated cells. Analysis of established cell lines revealed that Sgy gene expression could be fully repressed by methylation of the Sgy promoter, and that DNA methylation acted synergistically with chromatin deacetylation. Differential gene expression correlated with differential DNA methylation, resulting in sharp transitions from methylated to unmethylated DNA at the open promoter in both normal cells and tissues, as well as in established cell lines. However, neither promoter was methylated in normal cells and tissues even when its transcripts were undetectable. Moreover, the Sgy promoter remained unmethylated as Sgy expression was repressed during ES cell differentiation. Therefore, DNA methylation was not the primary determinant of Sgy/Tead2 expression. Nevertheless, Sgy expression was consistently restricted to basal levels whenever downstream regulatory sequences were methylated, suggesting that DNA methylation restricts but does not regulate differential gene expression during mouse development. La is an abundant RNA-binding protein that has been proposed to function in multiple pathways involved in the production of tRNAs, ribosomal proteins and other components of the translational machinery (Kenan and Keene, 2004 Nat Struct & Mol Biol, 11:306). Human (h)La is either phosphorylated or nonphosphorylated on serine-366 (S366, pLa & npLa, respectively). In addition to its conserved N-terminal domain, hLa contains a C-terminal domain that contains an atypical RNA recognition motif (RRM) and short basic motif (SBM), whose distinct mode of RNA binding is inhibited by S366 phosphorylation. We report that npLa is most concentrated in nucleolar foci that harbor fibrillarin, nucleolin, and nascent pol I transcripts. Immunoprecipitation of native or tagged hLa as well as yeast two hybrid analysis and fluorescence resonance energy transfer (FRET) in the nucleolus, reveals association with nucleolin. HLa lacking the SBM fails to localize to nucleoli and does not exhibit FRET with nucleolin. The data indicate that the nonphosphorylated SBM directs interaction with nucleolin, and provides evidence that the npLa specifically is involved in nucleolar biology related to ribosome biogenesis.